Documents filed under Taxes & Subsidies from USA

Texas Public Policy Foundation released the paper “Texas Wind Power Story: Part 1 – How Subsidies Drive Texas Wind Power Development,” which shows that the growth of the wind industry in Texas is spurred by, and only viable because of subsidies such as the production tax credit, along with tax breaks at the state and local level. A summary of the paper is provided below. The full paper can be downloaded from the links on this page.

Texas Public Policy Foundation released the paper “Texas Wind Power Story: Part 1 – How Subsidies Drive Texas Wind Power Development,” which shows that the growth of the wind industry in Texas is spurred by, and only viable because of subsidies such as the production tax credit, along with tax breaks at the state and local level. A summary of the paper is provided below. The full paper can be downloaded from the links on this page.

In 2012, Senator Bob Menendez (D-NJ) filed S.2204, the Repeal Big Oil Tax Subsidies Act of 2012, that would eliminate over $20 billion dollars in what he defined as annual tax subsidies for “major integrated oil companies.” The savings would be redirected to renewable energy programs. The bill failed, but during the floor debate, Senator Kyl (R-AZ) presented a detailed review of the tax code regarding the oil and gas industries and showed how there were no special tax provisions for these industries. The transcript of Senator Kyl's speech on the Senate floor is provided below and can be accessed by clicking the links on this page.

The North Dakota State Senate and House Majority Leaders submitted this letter to the North Dakota federal senator, Senator John Hoeven, expressing their concerns with the wind production tax credit and the crushing energy policies of Washington that are destroying traditional energy development while pressing for more renewable energy. A portion of the letter is provided below. The full letter can be accessed by selecting the document links on this page.

The North Dakota State Senate and House Majority Leaders submitted this letter to the North Dakota federal senator, Senator John Hoeven, expressing their concerns with the wind production tax credit and the crushing energy policies of Washington that are destroying traditional energy development while pressing for more renewable energy. A portion of the letter is provided below. The full letter can be accessed by selecting the document links on this page.

Introduction: Thirty states including the District of Columbia have adopted Renewable Portfolio Standards (RPS) specifying shares of electricity consumption provided by renewable energy. RPS proponents argue that these policies are needed to reduce greenhouse gas emissions. They also argue that the construction of renewable energy facilities increase employment opportunities. Opponents assert that Renewable Portfolio Standards increase electricity generation costs and rates paid by customers, which reduces regional economic activity. The objective of this study is to provide a balanced look at the issue, weighing the costs and benefits of Renewable Energy Portfolio Standards. A portion of the study's executive summary is provided below. The full report can be accessed by clicking the link(s) on this page.

High Cost - Since being adopted in 1992, the cost of the PTC for wind energy has ballooned from roughly $5 million a year in 1998 to $1.5 billion annually today. This open-ended subsidy of 2.3¢/kWh in after-tax income represents a pre-tax value of approximately 3.5¢/kWh. In many regions of the country the PTC now equals, or is greater than, the wholesale price of power.

Texas PUC chairwoman, Donna Nelson, has initiated an investigation into "the costs of [transmission] system upgrades, the costs to maintain and operate the current system, and the allocation of those costs specifically related to renewable resources." In her memo below (and attached). Chairwoman Nelson warns of the costs, particularly of the wind PTC is extended by Congress.

In this paper, Joseph Cullen quantifies the emissions offset by wind power for a large electricity grid in Texas using the randomness inherent in wind power availability. When accounting for dynamics in the production process, the results indicate that only for high estimates of the social costs of pollution does the value of emissions offset by wind power exceed cost of renewable energy subsidies. An excerpt of Mr. Cullen's paper is provided below. The full paper can be downloaded from this page.

In this paper, Joseph Cullen quantifies the emissions offset by wind power for a large electricity grid in Texas using the randomness inherent in wind power availability. When accounting for dynamics in the production process, the results indicate that only for high estimates of the social costs of pollution does the value of emissions offset by wind power exceed cost of renewable energy subsidies. An excerpt of Mr. Cullen's paper is provided below. The full paper can be downloaded from this page.

Senator Alexander of Tennessee and Senator Manchin led the charge in asking the Senate Finance Committee to oppose extension of the wind production tax credit. The full content of the letter is below. The actual letter with signatures can be accessed by clicking the link on this page.

This document examines the cost of wind power after considering federal subsidies and the effect the subsidies on market energy prices. The conclusion of the document is provided below. The full document can be accessed by clicking the links on this page.

Earlier in 2013, Wyoming Wind & Power LLC (WW&P) submitted an application to the Wyoming Industrial Siting Council seeking approval to construct and operate a 900 megawatt (300 turbine) facility in Platte, Goshen, Converse and Laramie counties. WW&P has canceled the project citing various reasons. A portion of the letter submitted to the Siting Council is provided below. The full letter can be accessed by clicking on the link(s) at the bottom of this page.

This report is the response of a committee appointed by the National Academies to a charge by the U.S. Congress to conduct “a comprehensive review of the Internal Revenue Code to identify the types of and specific tax provisions that have the largest effects on carbon and other greenhouse gas emissions and to estimate the magnitude of those effects.” The committee is composed of experts in tax policy, energy and environmental modeling, economics, environmental law, and related areas. The general findings of the study are shown below. The full report can be accessed by clicking on the link(s) at the bottom of this page.

This testimony, prepared by Lisa Linowes, examines the Class I RPS market in the State of New Hampshire. Aggressive policies in the New England region have resulted in New Hampshire RECs migrating to other states. This testimony was submitted in reference to the Timbertop wind energy proposal, a 15 megawatt project proposed to be built in the state. A portion of the testimony is shown below. The full testimony can be accessed by clicking the links on this page.

This notice provides two methods that a taxpayer may use to establish that construction of a qualified facility has begun. A taxpayer may establish the beginning of construction by starting physical work of a significant nature as described in section 4. Alternatively, a taxpayer may establish the beginning of construction by meeting the safe harbor provided in section 5 (Safe Harbor). Although a taxpayer may satisfy both methods, a taxpayer need only satisfy one method to establish that construction of a facility has begun for the purpose of qualifying for the PTC or ITC.

Economist Robert Michaels PhD presented this important testimony at a hearing before the Oversight Subcommittee and Energy Subcommittee of the Committee on Space, Science, and Technology. Dr. Michaels addresses the inefficiencies of wind energy and high costs of the technology. The purpose of his testimony is provided below. To access the full testimony, click on the link(s) at the bottom of this page.

This important report prepared by the United States Government Accountability Office examines federal wind-related initiatives. The GAO identified 82 wind-related initiatives that were fragmented across agencies, most had overlapping characteristics, and several that financed deployment of wind facilities provided duplicative financial support. The 82 initiatives were fragmented because they were implemented across nine agencies, and 68 overlapped with at least one other initiative due to shared characteristics. A summary of the report is provided below. The full report can be accessed by clicking on the links below.

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